Cabela's 2014 Annual Report Download - page 17

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to the customer immediately thereafter. Maintaining the growth of our credit card program, while continuing to
underwrite high-quality customers, actively manage our credit card delinquencies and charge-offs, and provide
exclusive experiences is key to the successful performance of our Financial Services segment. The growth of
Cabela’s CLUB program is dependent, in part, on the success of our Retail and Direct businesses to generate
additional sales and to attract additional Cabela’s CLUB customers.
Underwriting and Credit Criteria. We underwrite high-quality credit customers and have historically
maintained attractive credit statistics compared to industry averages. The scores of Fair Isaac Corporation
(“FICO”) are a widely-used financial metric for assessing a person’s credit rating. Our credit cardholders had a
median FICO score of 795 at the end of 2014 compared to 793 at the end of 2013. We believe the median FICO
scores of our cardholders are well above the industry average. Our net charge-offs as a percentage of total
outstanding balances were 1.69% in 2014, which we believe is well below the 2014 industry average, compared to
1.80% in 2013 and 1.87% in 2012. Refer to “Asset Quality of Cabela’s CLUB” for additional information regarding
our credit card loan charge-offs and delinquencies on our credit card loans.
Products and Merchandising
We offer our customers a comprehensive selection of high-quality, competitively priced, national and regional
brand products, including our own Cabela’s brand. Our product assortment includes merchandise and equipment
for hunting, fishing, marine use, and camping, along with casual and outdoor apparel and footwear, optics,
wildlife and land management products and services, vehicle accessories, and gifts and home furnishings with an
outdoor theme.
The following table sets forth the percentage of our merchandise revenue contributed by major product
categories for our Retail and Direct segments and in total for the last three years.
Retail Direct Total
Product Category: 2014 2013 2012 2014 2013 2012 2014 2013 2012
Hunting Equipment 47.1% 51.0% 49.5% 37.1% 41.2% 37.1% 44.3% 48.0% 45.3%
General Outdoors 29.6 26.8 28.7 32.0 29.1 32.0 30.3 27.5 29.8
Clothing and Footwear 23.3 22.2 21.8 30.9 29.7 30.9 25.4 24.5 24.9
Total 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0%
Hunting Equipment. The hunting equipment merchandise category includes a wide variety of firearms,
ammunition, optics, archery products, and related accessories and supplies for almost every type of hunting and
sport shooting. Our hunting equipment products are supported by in-house services such as gun bore sighting,
scope mounting, and bow tuning to serve the complete needs of our customers.
General Outdoors. The general outdoors merchandise category includes a full range of equipment and
accessories supporting all outdoor activities, including all types of fishing and tackle products; a wide selection
of boats, electronics, and marine accessories and equipment; camping gear and equipment for various experience
levels of outdoor enthusiasts; food preparation and outdoor cooking products; all-terrain vehicles and accessories
for automobiles and all-terrain vehicles; and gifts and home furnishings. This category also includes wildlife and
land management products and services, including compact tractors and tractor attachments.
Clothing and Footwear. The clothing and footwear merchandise category includes fieldwear apparel and
footwear, sportswear apparel and footwear, including technical gear for the active outdoor enthusiast, apparel and
footwear for the casual customer, and workwear products.
Cabela’s Branded Products. In addition to national brands, we offer our exclusive Cabela’s branded
merchandise. Sales of our branded merchandise are included in the above table that shows the percentage of
merchandise revenue contributed by major product categories for our Retail and Direct segments and in total.